The company executives said that a foreign company has been roped as a partner for development and research of the technology, and will introduce it in the market once all the regulatory and other approvals are in place. The company is on the lookout for space around the automotive hubs like Chennai or other similar places, the executives said.

Interestingly, commercial vehicle (CV) major Ashok Leyland had in January last year signed a letter of intent with Phinery of Israel for development of aluminium air batteries.

According to the industry experts, aluminium air batteries produce electricity by the reaction between aluminium and oxygen available in the surrounding air. However, though the technology has been in the global market since past few years, it failed to gain traction due to the high cost of anodes and the cumbersome process of byproduct removal from the electrolytes. However, considerable improvement has taken place since then in this regard, the experts said.

Finance Minister Nirmala Sitaraman in her Budget speech in July had talked about setting up of such mega factories with the plans to make India the hub of electric vehicles in coming years. The government had in March announced a plan to set up Tesla-like battery manufacturing Giga plants in India under National Mission on Transformative Mobility. The plan, which will be phased out over five years, envisages a few large scale, export competitive integrated batteries and cell manufacturing. The Tesla Gigafactory1 is a lithium-ion battery assembly factory near Nevada which provides battery packs to electric vehicles and stationary storage system.

A Niti Aayog report said that EVs use power-electronics extensively. India had an early start of its power-electronics industry. However, the industry has not kept pace with new developments that have seen digitisation of power-electronics over the last decade. India would need a new power-electronics industry, which can help develop and produce high-efficiency sub-systems for EV industries.

A recent Icra report claimed that the battery cost of EV, accounting for almost one-third of the total cost, will remain a key determinant in the rate of acceptance of EVs globally. In a significant development, the cost of lithium-ion EV battery has fallen to almost one-fourth to $208/Kwh in 2017 from $800/Kwh in 2011.

According to industry experts, the electric vehicles industry is at a nascent stage in India. It is less than 1% of the total vehicle sales but has the potential to grow over 5% in the next few years. At present, there are more than four lakh electric two-wheelers and few thousand electric cars on Indian roads.